The market can expect a rollover in the US June methanol contract

May 20/2011

(ICIS) -- The market can expect a rollover
in the US June methanol contract unless crude prices drop significantly, buyers
said on Thursday. The monthly contract range has been perched at 126-128
cents/gal for the past four months as energy prices have seesawed. Front-month
natural gas futures have declined about 6% since early February, while crude
futures have increased 7%.

Months of listless trading in the spot market have cooled the arguments
of sources who often push for contract reductions based on energy prices. One
buyer said a rollover was just a better bet right now.

Spot prices currently range from 107-108 cents/gal.

Methanex and Southern Chemical Company (SCC) historically have set the
monthly North American contract methanol range with their nominations.